CRM Metrics – Defining What Matters
Being a consultant in the CRM space for over two decades, I worked for many customer implementations from multiple industries with varied sizes.
A key question that often comes my way is ‘How we bring improvement to some or all aspects of CRM?’
If I get downright to ‘Why CRM?’ the answer is confirmed to only two processes, Customer Relationship Management helps in acquiring and retaining customers – Customer Acquisition and Customer Retention. Marketing and sales processes predominantly manage customer acquisition while the retention part is taken care of by the services and sales processes (upsell).
The fundamental and underlying processes that are present in both acquisition and retention include Account Management (Hunting and Farming) and Contact Relationship Management (Simple acquaintance to a brand promoter).
Customer acquisition and retention are equally important to understand business performance, but before we dig deep into these metrics, you might as well want to know why do they matter in the first place? This article covers these two aspects from a B2B context. So, let’s start addressing why it is critical to measure these key metrics.
Measuring the key metrics:
Growing up, I remember reading about ‘Success,’ and this line intrigued me and stayed with me even today. It’s a simple but effective one. To become successful, you’ve got to travel through two phases,
The first phase is to define what you want and set a plan to reach there – Setting goal and plan
The second phase is all about implementing what you’ve planned – Implementing the plan
The first part is probably more important than the second one because once you chose a wrong goal, even if you sketch out a great plan and reach your destination, you may not relish your success.
Implementing your plan is often the tough part and involves acquiring the right skills and competencies required to execute the plan and also involves a lot of determination and perseverance to overcome many obstacles. Likewise, measuring the key metrics help you understand where you are at and what you should do to reach where you want to be.
As businesses continue to invest in CRM initiatives, the goal is often to improve customer/prospect facing aspects of their business. If you have the required metrics in place, you can easily identify the main elements of the business plan to measure and improve.
In a B2B scenario, the relationship between your firm and your customer often involves multiple stakeholders on both sides with numerous touch points. Measuring the key aspects of various processes help you learn how you are doing currently and how you can bring about a change that can help improve the metrics.
Your CRM system should easily provide you with all the Operational metrics. The second set of metrics that bring about the biggest impact falls under the category of Customer Perception metrics.